Joseph Paul Freije - Page 17

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         incorrect.12  Second, respondent applied $6,500 of remittances               
         made by the Freijes in 1999 to their 1997 liability, even though             
         all assessments of the 1997 liability were extinguished by                   
         respondent's crediting of petitioner's $1,776 check as $11,776 on            
         July 8, 1998.  Although neither party has addressed the issue, as            
         discussed more fully below, respondent's application of the                  
         Freijes' 1999 remittances to their 1997 account contravenes                  
         O'Bryant v. United States, 49 F.3d 340 (7th Cir. 1995).                      
              Claim of Payment                                                        
              With respect to petitioner's contention that certain 1997               
         payments were improperly applied to 1995, respondent argues that             
         we lack jurisdiction to consider 1995, citing Lister v.                      
         Commissioner, T.C. Memo. 2003-17.  We disagree.  We held in                  
         Lister, a Memorandum Opinion, that our jurisdiction under section            
         6330(d)(1) was confined to the years that were the subject of the            
         notice of determination, where the taxpayer had attempted in the             

               12 Had the Freijes' June 3, 1997, remittance of $2,800                 
          (which was undesignated insofar as the record discloses) not been           
          applied in part against their 1995 liability, we assume                     
          respondent would have treated it as a payment of estimated tax              
          for 1997, as he did with respect to the Freijes' $2,300                     
          remittance made 1 week later on June 10, 1997, and their $1,500             
          remittance made on Oct. 6, 1997.  There is evidence that the                
          Freijes intended all of the foregoing remittances to be payments            
          of estimated tax for 1997, in that they reported in the 1997                
          return the total of these three remittances ($6,600) as the                 
          amount of estimated tax paid.                                               
               On this record, given the Freijes’ myriad remittances, we              
          are unable to conclude that a change in the unpaid liability for            
          1997 would have had no impact on the computation of any additions           
          to tax for untimely payment in 1998 and 1999.                               

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